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Great Debate Beyond Health Care Reform

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Texas 18, Us 11, Lovell 8, Houston 6, Pauline 3, Washington 3, Krys Boyd 2, Texas Lyceum 2, Lyceum 2, Andy 2, Jackson Walker 2, Massachusetts 2, Austin 1, Dallas 1, George Bush 1, Paul Keckley 1, Andrew Von Eschenbach 1, Pauline Rosenau 1, Ibm 1, United 1,
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  PBS    Great Debate Beyond Health Care Reform  

    September 7, 2010
    10:30 - 11:30pm PDT  

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>> this program is made possible by altria, the methodist hospital, jackson walker llp and saint luke's episcopal health charities. >> hello and welcome to the texas lyceum "great debate" series. i'm krys boyd with kera and the texas lyceum. how can healthcare be affordable for texans? it's a question how we craft public policy, set community priorities and make personal decisions. joining us to talk about what texans will have to consider in taking action to make healthcare affordable we have four panelists, lovell jones is
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director of the center for research on minority health at md anderson cancer center. paul keckley is the executive director of the deloitte center for health solutions the healthcare research arm of deloitte llp. pauline rosenau is the professor of management policy and community health at the texas school of health and andrew von eschenbach is director, senior director for strategic initiatives at the center for health transforms. great to have you all with us. we have to start a discussion like with some definitions what does it mean for consumers of healthcare that it is affordable? >> we serve thousands of consumers. and when we ask that question, they think in terms of what it prevents them from purchasing otherwise. it's always framed in the context of their out-of-pocket expenses, not their total cost. and it's always relative to other things that they would
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purchase if they did not either have to purchase or obligated to purchase healthcare. so it's variable. it's variable. >> the definition of, in most modern western industrialized countries, it's about six, eight, 10% of your income should be devoted to healthcare not much more than that. in our current healthcare reform bill, for all of the mandate issues; that is, what's the maximum you should have to pay and if you have to pay more than that, then you should sort of be exempted from that mandate, it's about 8, 9, 10% in that range, depending on the various categories. but affordability is defined as a percentage of your income. >> people look at affordability whether they're sick or healthy. that number doesn't really change. >> it probably won't make a difference going forward. but our healthcare reform in terms of insurance will cost the same whether you're sick or healthy. >> your question raises a very
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interesting point about how do americans think about their healthcare from an economic perspective. and as a physician, i think more often than not the answer is they don't. they really do not have a real concept of how much it actually costs to take care of them. and so affordability becomes a very relative thing. i think what they really mean when they say affordability is no matter what happens to me, am i going to be able to get the care that i will need at that particular point in time. and will it be paid for by my insurance or by someone else and how much might i have to add. but they really don't think in economic terms when they think about healthcare. >> i think the better question is: is health and healthcare a priority in the nation, in terms of where the dollars are spent. >> how would you answer that? >> i don't think it is. if you look at the total.expenditure, if you look at total expenditure in terms of military expenditure, if you look at total expenditure in
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terms of how much the american public spends on, say, haagendaas ice cream say to clean water or education or cosmetics or in terms of dog food. >> but even at the share of the gdp that healthcare is right now? >> yes. >> i don't agree with that one. at $781 per capita, it's a pretty hefty cost. the fact that consumers are not exposed to any more than a fourth of that directly or indirectly is probably the problem. but, yeah, we spend a lot on the system. it's a fourth of the federal budget. and the fastest growing expense in the household, fastest growing expense at the state level. so your question was affordability. and the technical answer in the reform bill is as a percent of income. that's not the way people think about affordability. they think about it in the moment, when they're presented
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with a bill or a co-payment or lack of, and then they have to seek some other option. and that's probably the problem. we don't make what anything costs in this system very transparent or even understandable. >> let's talk about that. because if i were to buy a car, new or used, i can go online and buy a blue book value so i know what the dealer paid what's a reasonable amount of profit for that dealer to make. why is it impossible to know what it really costs for a cat scan or a round of chemotherapy or anything? even based on what the insurance company might reimburse the provider for as opposed to an individual who doesn't have coverage. >> you have to understand the system itself and the fact that when you are attributing a price to a particular product, like how much does it cost for the ct scan, there are so many other parts and pieces that have to be factored in to not just the performance of the ct scan, but all the other infrastructure,
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all the other things that go along with even having a ct scan available. so you wind up with what is considered to be a cost or a price, but it's really not a very sound economic business understanding of all the costs that are associated with our ability to care for a patient. >> but you could do that -- triple things. >> it could be done, but i think you would agree that it hasn't been done in the way that it gets the transparency that you're talking about, where you can take a car and all the parts and pieces have been accounted for and you have a final price for that particular unit. we just haven't had that kind of discipline, if you will, in our current system. when i was practicing at md anderson, we knew what we might charge for a radical prostatectomy for a patient with prostate cancer, but that charge
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wasn't really reflective of the exact cost associated with that surgery, it was just a way of being able to create an accounting so that revenue matched expenses. >> that sounds like a really byzantine way to run a business. >> that's why we're in so much trouble. >> very efficient in in terms of how it operates. >> from the point of view of the patient, it doesn't matter how much it costs for each individual part of that operation. because they have insurance. and so they pay for their insurance, and the rest is paid for by the insurance company. for example, if you ask me i have fire insurance. if my i'm asked how much does it cost for the fire department to come out hey i don't know.i don't need to know because i have fire insurance. that's the way it's going to be with the insurance companies. it's insurance companies that will have to worry about the price and transparency and negotiating discounts for different operations, not the patient. >> paul may have very interesting insight into that.
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the question is unearthing a very important set of issues. we talk about healthcare cost. and what we can afford. and you mentioned it as a percent of our gross domestic product, of gdp. we think about the cost of healthcare as a nation. and then we're talking about the cost of healthcare as it relates to a person, an individual. they're two completely separate things. our expenditures as a portion of our gdp to 16 to 17% that we spend, most other countries, when they use a portion of their gdp to purchase healthcare are purchasing goods and services. they're paying for procedures. they're paying for drugs. we've done that in the united states, but we've done something in addition to that. we're spending a lot of our gdp for not just the purchase of goods and services, but as an investment in research. so a lot of that gdp dollar is
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not going for what we're going to pay for today but what we'll purchase tomorrow. most of the other countries don't do that. and if you look at where the innovation is coming from from around the world, you see over the past decade that's been primarily driven by the investment that the united states has been making. >> yet, there's a lot of argument that patient outcomes in this country, a lot of statistics to say they're not as good as other industrialized countries. if we're the ones spending our money on innovation why is it that many times patients in this country don't fare as well as their counterparts in other parts of the world. >> that's not necessarily the fact that our healthcare isn't sophisticated. we have the finest healthcare in the world. we may not have the finest healthcare delivery system in the world. i think lovell would comment on the fact that where we're seeing those inconsistencies is probably due to how poorly we deliver the healthcare that we
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have. >> that's a tremendous gap between discovery and delivery. and we see it taking place. i can give you an example in large major cities, including houston, where 15 to 20 years ago, the black/white difference in terms of breast cancer outcome mortality was not that great. today, in the city of houston, black women die four times the rate of white females. >> what accounts for that? >> i think it's the delivery system. i think technology has gotten very good. but how we deliver it to individuals of color individuals, i'd say if you go to west texas you'd find the same impact. if you go to chicago, we know the same thing is happening. and new york. to a lesser extent, but still happening. in la it's happening that way. we're going to have to solve the system how we take these discovery and deliver them, and maybe health reform will help in
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that. i don't know. >> when you say system, are you talking about incentives or are you talking about the delivery system? >> the actual delivery system. >> if the incentives and the spotlight were focused on disparities by ethnicity or disparities by geography or disparities by sex, we've had, in heart disease, a huge amount of data showing a huge differential. >> men get better care than women. >> yes we've built a lot of our science around males and heart disease. so if the spotlight in the incentives were toward those gaps in what's better than the status quo, wouldn't the system adapt? >> it hasn't in cancer. it hasn't in -- >> but where were the incentives? >> i'll give you an example. cardiovascular, which you just talked about. one of the things that has taken place in cardiovascular disease is the diversity of the individual who now cares for cardiovascular patients. and that came about by the
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national heart lung institute saying who are individuals who both do the research and deliver the care. and what we know now is that individuals, at least individuals with color, when they go out and practice, will have a higher percentage of individuals who are underserved or who are uninsured or underinsured in terms of their practice. and i think that has been one of the ways that at least in cardiovascular disease it's been solved. it hasn't taken place in any other. >> i want to go back to something pauline mentioned. you said on the consumer side we don't care what it costs because we care what it costs us specifically. there are 6.1 million people in texas who are not covered by any health insurance, what changes when more of these people, i think it would -- no one would argue it will be all of them but when more are moved into some kind of coverage, medicaid or
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health exchanges, do we have the infrastructure to serve millions more people who might be accessing care on a regular basis? >> we have three years to get ready. massachusetts did this experiment a couple years ago. and what we've learned from the massachusetts experiment is that there will be a huge demand for primary care physicians, and it's certain that we here in the texas medical center are going to have to think about that, because we really emphasize a lot of specialty care. but there are other solutions to this problem of a huge increase in demand, when 17% of the population nationwide, probably closer to 30% in texas, suddenly have health insurance. health insurance, by the way, isn't going to make you well. it does give you access to the healthcare system. but there are lots of other things that will improve your health as well. but what are we going to do about all these people who will need primary care physician? right now, there's something
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called the federally qualified health centers, which george bush set up. funded very generously and in this country 20 million people get their care there. under the new healthcare reform bill, that's going to double. $6 billion. i think it's five years. but that's a huge amount of money, and many people who will have minimum paying kind of insurance such as medicaid in texas, that number is going to increase. but they will get their healthcare at the federally qualified clinics. there's nurse practitioners. there's physician assistants. there's in short expanding and stretching our primary care doctors to serve more people. that's likely to happen and let's hope that everybody's on line and working on it, because it's going to be, just as you said, a big crisis. >> andy, i can see you want to jump in. >> krys, i think what we have to focus on is we've been looking at healthcare as an economic problem, as we should. but at the end of the day it's a problem about people.
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and when you think about it from a person-centric, patient-centric, point of view and ask the question what should we be doing in this country, what should we be doing in texas for people. what people want is they want to know they have access to quality healthcare. and access means: is it going to be affordable for me and my means? is it going to be available to me when i need it? and is it going to be appropriate for my specific or my particular problem. so what we're talking about when we talk about making it affordable, is that that's only one piece of the problem. it's a systems problem. and pauline's referring to the fact that even if you're insured, that doesn't mean healthcare's available to you. because there may not be a physician to care for you in that community. or as lovell's pointing out, there are people in our society who are surrounded by medical centers and physicians. but, yet, healthcare is not available to them for other
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reasons, perhaps. so we've got to attack this as paul is doing in washington, we have to attack this as a systems problem. now, washington is where the debate and discussion is. but just like all politics is local, all healthcare is personal. and we've got to get down to the community. we've got to get down to where people live, and we've got to get down to states, like texas, because at the end of the day, that's where the action is. that's where the implementation is. and that's where the opportunities are. >> it's going to take more than just us in the health arena to solve this. people tend to look at the ose h arena as being the individuals who are going to solve this, but it's going to take all of us. to get back to what pauline was saying in terms of the federally qualified health centers, in houston, i think we have four. maybe six. >> we're getting more. >> you have to be prepared to do that. and i think we aren't prepared. we've not been prepared across the state to be receptive to
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have federally qualified health centers. you have to go through a pre-state to be able to qualify for it. sometimes it takes several years to get that way. and i don't think we're starting to prepare for that. and i think the policymakers really should start thinking about that in terms of aiding and helping individuals to move towards that. >> you mean the policymakers in austin? >> locally. >> in houston? >> in houston, the rio grand valley and el paso and dallas, across the state. >> crisis is here and the time is now. and let's get moving. >> how has increased spending at the state and federal level, for example, county budgets where a lot of health facilities are dealing with people who have had no coverage in the past and haven't really turned very many people away? >> there's a complete disconnect in the funding apparatus of healthcare between federal, state and local levels. so if you try to make those things line up in some sort of rational way they don't.
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>> is that deliberate? >> no, it's the nature of policy. it's the ugly nature of policy. so you have a state without a con. you have a state that decided what it would include in medicaid. and what level of poverty people would have as eligibility age. >> we have fewer adults covered by medicaid in texas. >> you have a very -- compared to the other parts of the country -- you have one of the most lean medicaid programs in the country. notable so if you try to step back from the system. it's really ugly, messy. you can't make a lot of broad judgments about it, other than it's broken. one of my friends in dc observed in this reform process that the system is perfectly designed to get the results it's getting. and it is.
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we're paying for doing more things, not paying for doing right things. so when lovell says we don't have a spotlight on preventive health and ethnic disparities but we'll spend a fourth of medicare on the last year's of a medicare enrollee's life that's designed in the system. so if you change the design, you fours people to be uncomfortable who are comfortable with the status quo. and this system has rewarded a lot of people. i'll bet there are shortages of primary care in your schools of medicine here, and i'll bet if you looked at the numbers, i'll bet the specialists are doing okay. and i think you've got a difficult process of stepping back and saying can you incrementally change the system? or does it take some sort of a radical transformation of the system, and will the public
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accept that? and our polling says most people want to protect most of what we have and tweak it around the edges. so can we afford that? can you afford that. >> most people have health insurance, and they love their doctor, and they think the local hospital they go to is great. but we still have a huge number of people who are going to finally have insurance, and their perspective is going to be a little different. i think we have to be more optimistic. the opportunities are right there. texas will get one hundred 91 billion from the government between 2014 and 2023. and so we have to as texans come up with about 21 billion as matching. that's a very generous match of 7 to 1, 6 to 1 and what are we going to do with that money, if we're optimistic and policymakers who will look forward and take that and say we can do a lot.
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and it's the multiplier effect of that federal money that will even be good, not just for the health of texans but for our economy as a whole. 191 million economists say it's about three. which means it's a lot of money for a state that has some of the, amongst the highest rate of uninsurance, of underinsured in addition to not having insurance. i'd like to be optimistic. what are we going to do with these opportunities? >> let me ask you: it's a lot of money. but throwing a lot of money at the problem isn't necessarily solving the problem. so we have people who have insurance. how is it going to fundamentally change the system? the system that paul and lovell and all of us are agreeing is broken. it's just not aligned with the reality of what we have to deliver. >> as i saw, you do the same things you keep doing and have already been doing you're not
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going to get a different outcome. so the question is what to do next. >> one of the problems is how we look at something. i remember as a kid, immunizations for polio. for a number of things. it didn't discriminate in terms of where you were. you could be in the poorest community. you could be in the richest community, you got immunized. that's because your health was just as important to me as my health. i never knew when i would come in contact with you. therefore, i had to be sure that you were healthy. we've now moved into the era of chronic diseases, where if you have cancer, yeah, that's your issue. if you have diabetes, that's your issue. if you have hypertension, that's your issue. but we don't realize that that connects to our health as well. it may not be biologically, but it connects to our health, and we have to get that message across that we have to be concerned about everyone's
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health, because it in turn will impact our health. >> i'm curious whether you all think it's possible to put an accurate dollar amount on the cost productivity of having people unable to access adequate healthcare. numbers are thrown around. but i wonder what really needs to go into that kind of equation to recognize if people remain outside of access to care, what does that mean to the state of texas and this economy and our ability to work into the future? >> i can't give you a dollar figure. but i will say -- and i've said before -- in an unhealthy region or state is not an economically viable situation. >> and i think that the awareness of that is exploding, especially among employers who are taking corporate responsibility for wellness now because they are realizing that good health of their employees is good business for them. and i've seen, for example, one concrete example of that with
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the national dialogue on cancer, creating ceo roundtable where they brought the chief executive officers of very large corporations together and said what are you going to do about the health of your employees? they put together a program called ceo gold standards with five interventions that would improve the health of their employees. didn't get very much traction at the beginning when it was just about improving the health of their employees, until there was an economic study that said: well, it will cost you x amount to put the program in. but after this period of time you're going to get x plus y back. and when they saw it was a net increase to their bottom line, those programs suddenly got rapidly implemented. now, that sounds a little cynical, but it's not intended to be. it's just simply that they have to make business decisions. but they're now also appreciating that those business decisions are actually creating
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better bottom lines for them. healthier workforce, greater employee morale, and being able to keep people well is far less expensive than treating them when they're sick. we've already known that. and now we see people coming along like gallop, who is being able to use its powerful tools of surveying, and actually testing in communities and in populations the issues like well-being and the well-being index, and matching how well people are with how productive they are in society. and the numbers are starting to look stunningly impressive. and i think that's going to be a motivator for change in the system. >> so i've heard three out of the four of you say the system has not been working and been failing us for a long time. given that -- maybe paul this falls into your area of expertise -- whether or not people agree with the specific components of the healthcare
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overhaul as it's been passed, why do you think it is that so many americans are concerned about the idea of things changing radically even within the system of delivery? >> well, people are prone to think that the unknown is more fearful than what i have. so they don't like congress, but they accept their congressman. they think it's agreedy and self promoting but they like their doctor. in the poll most people said they don't like it but they hold their nose but they associate government solution to the problem postal service solution. we talk in our analytics about expectations what are people's expectations of the system? we have i think an unreasonable expectation of our system. i want the care i want based on what my doctor says, regardless
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of whether my doctor's recommendation is evidence-based or not. and i want someone else to pay for it. and if i don't do my part, being adherent to a treatment regimen, then i want the system to pay for me to get fixed again. that's an expectation that's fraught with inefficiency and it's the root of, i think, our problem. so a fix that was proposed, if you remember in campaign 2008, was let's just jump-start the reform and create a consumer system. let's just have everybody buy healthcare the way you buy auto insurance, or not. let's just use that as the forcing mechanism. let's get insurance companies and employers out of the mix and let's let individuals purchase healthcare the way they purchase anything else. you know, would that change the effect of the balance of preventive health to end-of-life care? i suspect.
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would it align incentives where we pay for performance instead of volume? i imagine. would people maybe want to know what things cost before they use it? probably. so expectations is your answer. we have an expectation of a system that's not reasonable and it's not sustainable. >> what do we do about people -- it's an interesting question -- who maybe have access to health insurance moving forward, but as you mentioned don't stick to the doctor's recommended regimen of treatment. sometimes it's as simple as quit smoking or lose enough weight so you're not obese. there are people who want to do it but can't. or just don't want to do it. should thereby a penalty for people who don't once they've been given medically sound recommendations don't follow along? >> well, there's two parts of that. and it's never simple. nonadherence to a treatment regimen is three out of four
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people. three out of four, nonadherent. and a chunk willfully going without. a person with a prescription in hand and goes to ngc and gets tree bark, is that willful nonadherence or is that acting on your own volition for alternative therapy. >> or on occasion not able to make a co-pay? >> is there a problem of economics that i can't afford the recommendation. is there unlawful nonadherence where i didn't understand what you said. there's a lot of science that says we do a lousy job communicating what you should do and there's nothing in the system that rewards doctors for patient adherence. basically they get paid for telling you what to do and when you walk out the door, that's it. so it's a system issue. >> well, there are some new experiments with different ways to deliver healthcare and
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accountable health organizations with doctors and nurses working together, putting doctors on salary and have them as a group take care of a large number of patients. so that is inevitable and we do need to find new models and i agree with you that most people are very pessimistic about the outcome of our healthcare legislation, but i also know that a lot of people don't know what's involved in that it. and you see major misunderstandings published in the press recently. so you've raised a lot of issues, but which way can we move toward a solution? >> we have at the beginning touched on a little bit of the issue of how our healthcare delivery system needs to change. but the incredible changes that are actually occurring in healthcare, what we're able to do for patients, because of science and because technology, and that can be a whole hour's discussion. but let me cut to the point. technology is going to radically change how we deliver
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healthcare. and it's going to be able to address some of these challenges that we're currently experiencing, like adherence to care. and being able to push the care beyond just the doctor's office or the clinic actually into the home. so you see companies like ibm, intel and microsoft, and so many beginning to think about what technologies could be used that would really enable patients to be much more active participants in their care rather than just simply passive recipients. what could be done to improve adherence to care? because we know when people do not adhere to care, their outcomes are worse and their costs are higher. >> one simple little most bit of recent science fiction whiz bang technology, pharmaceutical companies are making pills that
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have dissolvable micro chips in them so there can be an external reader, and i will know whether you swallowed that pill or not. >> are you comfortable with that, not as a physician, but as a regular person? >> i'm comfortable with the idea that we're going to be able to have technology that if my mom is supposed to be taking medication and she may be having a little bit of problems with her cognitive function, i'll know that she took the medicine. >> so how do we decide, who do we put in charge of evaluating whether every patient would do better if their doctor knew vee a micro chip that a medication had been ingested and when it works just as well to give a good old fashioned drug that's been on the market for 15 years and might provide similar outcomes? clearly some patients would benefit from that, and others wouldn't. how do we keep from moving from the standard from where the most expensive care is automatically perceived the best for each
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patient. >> the best performing health systems in the world and those that are the cheapest, with the best outcomes that beat us on the statistics don't have and don't use, emphasizing that kind of technology. so that gives me pause about -- i think it's great. and i would probably like it in a minute. but they're doing it right now. and they're doing it better than we are. >> i disagree with that. when you look at as lovell was pointing out the shift to chronic disease, and the problems we're facing with cancer, et cetera, their outcomes are not as good as ours. and let's move away from the science fiction and big brother. let me give you another example which i'd be interested to hear paul comment on from an economic perspective. one simple study that was done with patients who had a heart attack, and they sent them home with a wireless scale and a wireless blood pressure cuff and a laptop. and every day they had to get weighed and every day they had
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to take their blood pressure. and it was being wirelessly transmitted back to their care provider. if the care provider didn't get a message, they called them up. if they got a message and their blood pressure and their weight was fine, no problem. if they saw their weight go up or a blood pressure problem, they called them. they said what's happened? well, i went to my grandson's soccer game and i ate five hot dogs. we need to adjust your salt. we need to increase your diuretic. significantly reduced the frequency of visits to the emergency room for heart failure in the patients who had their care being managed. >> so that expenditure ultimately makes it cheaper in the long run? >> exactly. but the problem is we don't havt tracks the savings by having reduced the frequency of emergency room visits to what it costs to give somebody a blood
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pressure cuff and a laptop computer. so if you're looking at it as a provider, you say that's an expense, and i don't want to pay for it. but if you're looking at it as a healthcare system in a country, you'd say: that's a wise investment. i want the return. but our system doesn't do that, does it paul? >> i mean, the problem is the churn rate in the commercial population. the average churn of a commercial enrollee is about 15 percent. >> when you say churn that means -- >> that means the turnover of people employed under a traditional insurance program. i invest in wellness you go to work for somebody else i've just helped somebody else. andy's point is well taken. we've got a lot of technologies that would bend the curve on the patient adherence that are as simple as doctors communicating after a primary diagnosis exactly what your diagnosis is and a website to which you should be directed which only 9% of doctors do today. that's not high tech. that's low tech.
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just a site where a person could go to learn more about me. there are 2,000 articles, peer reviewed, that suggest that when patients in the teachable moment, when newly diagnosed, associate their inaction with fear or consequence, if they know something bad happens to them, now, the diagnosis determines what the fear or consequence might be. so a terminal diagnosis can mean i lose something dear to me. family. a diagnosis that's much less onerous, like you're going to do experience some pain or we can replace your knee, then expressing what that pain might mean. does it mean you can't play tennis. when the consumer knows fear and consequence around a primary diagnosis, then it shows that their adherence increases, that they actually act on their diagnosis. but what we've kind of done is we focus on in that seven
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minutes, when we talk about your new diagnosis we make sure we tell you everything we think that's important. we overload. and then the consumer walks away from the office and goes, wow, what do i do? so you've got some groups that are starting to figure that this is really not about just the teachable moment. it's this prompt, alert and reminding process for three to seven days after a diagnosis. when i can make habitual your memory when i don't do something something bad happens to me. that's low tech. we could be doing that in the system today we just don't do it. >> your it's not the physician that monitors the individual. it is home healthcare person that comes in and reminds them and works with them. and the diabetes outcome in that country is a lot better than it
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is here >> sure, because utilization of other individuals. with regards to high tech, that gets back to the gap. there are places in new mexico, on indian reservations, in arizona, where you're not going to get these systems to work. it all boils down to individuals, of equipping individuals to actually help and monitor in those teachable moments. >> we're doing studies now. it's interesting the use of wireless devices will probably make mute that problem. i don't think technology is the problem here. andy is spot on. i think this is a matter of aligning the incentives to get the results that we need to be getting, whether it's in the funding of the right places to fund health services or it's the incentives to reward behavior of providers and of individuals. and i can't determine that the incentives are aligned to get the system that we all want. that's my major concern.
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and i don't think the bill is a bad bill. i think it's an interesting start. but the result is unknown. i don't think any of us know whether it will reduce costs and when the president february 24th last year said it will cover everyone we know it will cover 32 of 57 million uninsured at the end of the decade. is that a good start? it probably prompted an important national discussion about healthcare that we probably needed for a long time. and we're going to hear it again in november in the elections and we're going to hear it again for the next few years. but we shouldn't stop. and the bill is not the end of this discussion. >> let's go from there and talk a little bit about compliance in terms of consumers. >> what we're seeing is although this bill has been passed in washington, its implementation is coming down very much at the state level. and states are struggling, just like raising the questions that you just did.
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states are struggling to try to figure out how they're going to adapt, how are they going to be able to incorporate many of these changes and serve their citizens. so one of the things center for health transformation is doing is creating a forum to bring states together to begin to kind of address mutual solutions or best practices that can get shared. so i don't think we have an answer for your questions today. but you clearly have raised significant issues that maybe in consultation, collaboration, with other states will get to those answers and get to them quickly. >> i agree it's going to take dialogue. not discounting anyone's view. but open and honest discussion about what we need to do in terms of addressing this issue. >> what do you think the lawmakers specifically in texas need to pay particular attention to? and then i'll pose that question to everyone else on the panel as well. >> preparing. because we -- >> we have to write the rules.
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we have to monitor the insurance companies. we have to set up exchanges. not just for individuals, but also for small business. not individuals, small businesses, and in 2017, we can actually have the state of texas set up an exchange, a market where large employers can buy their insurance for their employees. this is all about the state, with only i'd say a minimum of rules coming from the federal government. most of it in terms of checking out how it's going to work and ombudsman for all of us who have to it, we're not going to the federal government it has to be the texas state government. it's not just the federal, it's the state and federal government. >> i think we're going to have to learn to leave our biases at the door, to approach this as an american problem and it's a problem for texas. to approach it as if this is our last chance to really do
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something. when i talked to the panelists we talk about the 17%. if it rises to 26 or 27%, we're doomed. >> we're already there. >> we're doomed as a nation, because we are not going to be able to recover economically from that cliff. and that's both conservative economists as well as liberal economists. and so we have to do something now. and the bill has passed. let's not debate whether it should be repealed or whatever, let's make the best use of it. and as i said talk among ourselves to come out with the best way of addressing it for all of us, for all texans, for all americans. >> i'm still processing this is all about the states. i don't think i agree with that. i think there's a substantial role that the states play. but i see in this bill a clear
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federal role that's stronger. i think you'll find when the deficit reduction commission brings forth its recommendations december 1st, it will include additional entitlement cuts, different models of payment to the states. the secretary shall is 1,051 times in the bill. that's the secretary of health. >> but the secretary shall send this to the states to do. >> no, no, i've gone through it line by line. >> we have to disagree. >> it's clearly the secretary doing things like setting essential benefits. like premium review commissions. like medicare payment commission. so this is a very strong federal role in a system of care. >> quickly before we start taking audience questions, andy, what do you think? >> i think one of the things texas and other states are going
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to have to appreciate is that this bill is not the final answer, and that there are other critical parts of what we need to do that states are going to have to pay attention to. let me take, for example, fraud, waste and abuse. we have to drive out costs. and there's enormous amount of costs that were associated with those issues. and when i say fraud, waste and abuse, with regard to waste, i don't mean just conscious waste. there's so much about our system where we do the wrong thing for the wrong patient, or the patients are not getting the right outcome. where no other business could be sustained with that degree of waste that's inherent in it. so i think where the states are going to have real opportunities is to be thinking about implementing what's already been determined and decided, but looking at other places where they can also take steps that will reduce their costs and make healthcare more affordable for
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their citizen. >> at this point we would like to welcome members of our studio audience to interact with our panel. if you have a question, you can please just come up to the microphone and we'll get it answered for you. come on up. >> my question is what evidence is there that on a person-to-person basis the delivery of healthcare is not affordable now? >> there are lots of people who don't have health insurance because they choose not to purchase it. when it is made available to them. but there are many, many more who do not have health insurance because they cannot buy it. they have been sick and they have pre-existing conditions. it consumes more than ten percent of their income. they have a sick child, therefore their employer says we can cover you and your wife but not your child. it is indeed true that there are people who choose not to have it if it's offered by their employer, but that's the minority. and that will change, because insurance companies are now
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going to have to sell insurance to everyone who wants to buy it, to not take into consideration whether they've been sick or not, and to have limits as to how much they can charge more if you're a woman rather than a man, that's a 0 differential. but there are differentials such as age, 3-to-1. and there are a couple of other geographical errors. the insurance companies can charge you two or three times more if you're in an expensive area. that's one and a half times as well. but the body that assures that the insurance companies make it available, insurance available, that's at the state level. >> did you want to comment, andy? >> there clearly are people who could not afford insurance. but that's not to say their healthcare was not affordable. because they could get healthcare. and they could get good healthcare. the concern that many people have is that this bill is not going to actually solve the problem, it's going to make it
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worse. because now you don't have to have health insurance. you could pay a penalty. >> which is lower typically than the cost of healthcare coverage. >> and wait until you really need it. and then you absolutely are guaranteed to get it. so if i'm of that group that chose before not to take money out of my pocket and pay for health insurance, why would i even want to do it now? i'll just pay the penalty and wait until i really need it and then i'll get it. irregardless of what my diagnosis is. >> and none of this kicks in until 2014. so the insurance industry was already going to increase premiums for individual policyholders 11 to 13%. small groups, ten to 12. it will in this interim period increase premiums to the degree the state departments of insurance allow. but the numbers of people for whom insurance will not be
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affordable will increase in the near term as a result of the premium increases and before these mandates kick in. so it's a more complex problem than people imagine. and it's not tied -- the data on discretionary spending, it's not tied simply to a threshold percent of discretionary spending. when you're under $66,000 as a household, which is 300 percent of the federal poverty level, it's onerous when it's even at five and six percent, because of your obligations otherwise. so we have to avoid the sound bites in this thing. it's a little more complicated. >> yes. >> i'm john bettinger, houstonian management consultant with clients across the state. two-part question. my clients are concerned or let's say reticent to take action because maybe they're
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hopeful expecting some changes. one, do you think there will be material change or repeal. if not, what should texas employers be doing to get ready in the short term for the next few years. >> the likelihood of repeal is between slim and none. it would take 37 states to override this. so this is the law. >> i'm not so sure there won't be serious constitutional questions about the bill, some of which may undermine it so it's for all practical purposes defunct. but we'll have to wait and see on that. >> i go back to the idea. we need to have dialogue. this was not going to go away. and unless we start having this dialogue we're all going to be in the same boat. it's like in houston, we have only two level one trauma units. this city should have eight. and the dialogue, when we discuss having level one trauma units, always falls back to what we don't want these hospitals
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for uninsured and poor individuals. when we realize -- when we don't realize these are the hospitals that save our lives or have traumas not based on age or race or whatever. we don't discuss that. we always fall back to the simple answer. and the answer that does us no good in the long run. >> yes. >> where in the system do we begin to change the thinking about insurance and our responsibility to maintain and improve? as opposed to a demand to be able to respond to my illness when it occurs. >> the bill in three different areas addresses a much more significant attention to
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preventive health. it establishes via the secretary what she will determine to be preventive health. it says the parameters for what's primitive health. is a mammogram for a female in her 40s without a history of cancer to be treated as a preventive health and not to include a co-pay? it instructs insurance companies that within certain parameters they have to incorporate those essential benefits without certain co-pays into what they provide through these exchanges. and then it also says that we want to exponentially increase these pilots that we've had since 2006 in the medical home so that we can test out whether primary caregivers, not just doctors, primary caregivers, can
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be coordinated for care for preventive slowing the progression of chronic diseases. i think in this zone of preventive health, i think the bill has some pretty important positives to offer. and it's substantive. where the monies are invested in the bill and those three changes i think they're more than i've seen. i've done health services research 30 years. i haven't seen this kind of attention. so i think it's pretty good. >> i agree. i think it's there. but it's going to be what the information is based on. for instance, this last decision about preventive health services, moving, screening, recommending screening back to the age of 50, what it fails to take into account is that a large percentage of african-americans develop breast cancer before they reach 50. and in texas we have data now that a large percentage of hispanic americans develop -- >> said regardless, i'm
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going to cover it. >> to follow on, lovell is correct about the importance of education. what i was trying to emphasize is that i don't think that's the whole answer. and i don't think the bill is addressing many other problems like what are we doing about school lunch programs. what are we doing about childhood obesity. now the first lady is taking that on. but to lovell's point, we've got to approach this comprehensively. >> let's go back to our studio audience. >> seemed early in the panel there was a consensus that there's inefficient information leading to an inefficient market on price and cost among both consumers and providers of healthcare. what does the health reform bill do to address that particular issue, and if it doesn't, what are your suggestions on how we might approach that? >> it does address it. but you have to start with a bill that's a companion bill.
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that's february 17th, the stimulus act, which set in motion these $34 billion for health information technology. every doctor, every hospital with an electronic health record by 2015. so that's part of a of this puzzle. part b is that throughout the bill for instance administrative simplification is required of the insurance industry. we're going to move toward a common set of standards for which business transactions are based. there's a substantial amount of language across starting with the acute hospitals and extending to the skilled nursing and long term care providers of 2013, an explicit set of data points that have to be transparent and made available for public reporting. so no bill is perfect. does this bill point toward use of information technology and more transparency? yeah. could anybody in this room
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improve it? absolutely. it doesn't go to a lot of the public health metrics. so yeah it could be better but it's a good start. >> but from the point of view of the person purchasing health insurance on the independent market or the small business purchasing insurance, there will be an exchange which is like a market where you can go in and compare how much it's going to cost you to purchase that bronze plan, platinum plan, and then you can -- if everything else is held constant you can choose the best policy from the company that's doing you, what the market is supposed to do. is this -- it's very expensive administratively to have a market exchange like this. this is the system we've chosen. it's been tested in other states and it does work. >> that will have to be our final thought. that's all the time we have. thank you all for sharing your insights. it's been very interesting. [applause] >> the texas lyceum is a
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nonpartisan organization that works to identify and develop the next generation of top leadership in the state. to learn more about the lyceum and find bios of our panelists go to texaslyceum.org. my name is krys boyd. thanks for being with us and have a great week. >> this program is made possible by altria methodist hospital. jackson walker llp and saint luke's
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